Thats not how memory works in Windows though. Just because it can't address more then 4GB physically, does not mean it cannot address more virtually.
Each -application- believes it has 3GB of addressable space available to it (when /3G is used, otherwise its 2GB in a 4GB system) If enough apps are using more then the 3GB physically, Windows will swap until swap + physical ceiling is hit, then apps start crashing, not working etc. The limit per application is 3GB though, but you can technically have 3 apps each using 3GB of "memory" if you have at least a 6GB page file 
You need to evaluate the system before deciding. I'd say start with 1GB min/max and only adjust if you actually see it being used to that level in performance monitoring tools. You could probably get away with a 512MB page file and only 512MB assigned to the VM because the apps it runs only want about 300MB of virtual memory.
K, I know I left A LOT out, but there is a lot to understand.